Reserve Bank of India holds key interest rate at 5.25%

Business Aug 05, 2026

The Reserve Bank of India just hit pause on changing its key interest rate, keeping it at 5.25%.

This was widely expected, since global oil prices are up and there's tension abroad, usually reasons to raise rates.

But the RBI says inflation in India is still within its comfort zone, so no need to shake things up just yet.

Retail 4.38% wholesale 9.87% RBI warns

Retail inflation crept up to 4.38% in June (just above the RBI's target), but core inflation stayed steady around 4%, which helped calm nerves.

On the flip side, wholesale prices shot up 9.87%, and that could eventually push retail prices higher too.

The RBI is staying flexible but warns that if oil prices or global tensions keep rising, they might have to rethink their strategy.